IBM・s strategy in China was to go it alone. The company researched, produced, and distributed its own products. The Chinese government, however, viewed technology as a key factor for economic growth and national competitiveness: it wanted to promote technology transfer between foreign technology firms and domestic firms. As IBM・s business and ambitions in China grew, it would have to make a decision: would it compete and cooperate with local firms?

Functional Area :

Economics & Business PolicyStrategy & General Management

Learning Objective:

1) To understand the strategic reasoning of the Chinese government in promoting technology transfer, and how this rationale and government policies change over time; 2) To assess the advantages and disadvantages of IBM・s strategy of integrating Chinese operations globally under a ：one strategy； umbrella; 3) To use game theory to understand the potential payoffs, losses, and trade-offs for IBM in sharing core technology with Chinese firms.